satya (n/a) 20 March 2013

Risk involved in purchasing property from bank auction

Hi,

I'm interested in purchasing land in bangalore for cheaper price which is being auctioned by public sector bank. My initial intention is go ahead with the auction as it is secure one because it is from public sector bank. But it is being sold under SARFAESI Act with "As IS WHERE IS, AS IS WHAT IS AND WHATEVER THERE IS BASIS" clause. Is it a usual one or used in special cases. I'm afraid of going with this clause. Is there any risk involved in this regard. Bank people are not interested to give the copies of the documents. But they are ready to provide the details in the documents like registration doc number etc.

I need your advice with this regard.

1. What is the information i should extract from the documents

2. What are the documents should be provided by bank incase I purchase the land

3. How to find the litigations related to the land

4. Any approvals have to be verified

Regards,

Satya.

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3 Replies

Advocate M.Bhadra 20 March 2013

ORIGINAL ANSWER GEVEN BY SUNNY SHARMA IN www.legallyindia.com six months ago:--------

If you want to buy bank auction property then i m telling you the genuine procedure. first of all check the RECOVERY CERTIFICATE of that property which is issued by the presiding officer of DRT( debt recovery tribunal) to the recovery officer of the jurisdiction of the property with concerened bank. you have to fill the bidding form one day before the auction date till 5p.m.you have to pay 10% of reserved price of property reserved by the concerned bank.then you will be eligible for bid . if you got success for that property on auction day then you 've to pay 25 % immediate same day and rest 75% within 15 days .then after some formalities the authorised person of bank will go along with you to the registrar office to transfer the property in your name and he will also bound to give you the original title deed of previous owner. make sure before this the bank had verified the property before giving loan by your own sources.b'cose some instances happened many times before.you can also get the undertaking from bank where bank will be bound to pay huge penality if you dont get possession or the previous owner challange bank for wrong proceedings. If previous owner wins the you have to vacate the property n get your money back from bank with very difficulty.